Startup Metrics for Pirates (Sept 2012)

81
Startup Metrics 4 Pirates! GeeksOnaPlane 2012 Zagreb, Croatia Sept 2012 - #GOAP #AARRR Dave McClure @DaveMcClure http://500.co http://500hats.typepad.com http://slideshare.net/dmc500hats AARRR!

description

slides from my Startup Metrics for Pirates talk @ GeeksOnaPlane Zagreb event (Croatia, Sept 2012) #GOAP #AARRR

Transcript of Startup Metrics for Pirates (Sept 2012)

Page 1: Startup Metrics for Pirates (Sept 2012)

Startup Metrics 4 Pirates!

GeeksOnaPlane 2012 Zagreb, Croatia

Sept 2012 - #GOAP #AARRR

Dave McClure @DaveMcClure http://500.co

http://500hats.typepad.com http://slideshare.net/dmc500hats

AARRR!

Page 2: Startup Metrics for Pirates (Sept 2012)

WARNING:

Page 3: Startup Metrics for Pirates (Sept 2012)

WARNING!!! this deck is guaranteed to offend,

provide tragically incorrect advice, and perhaps get you arrested.

Fucking Deal with it.

Page 4: Startup Metrics for Pirates (Sept 2012)

Dave McClure Developer, Entrepreneur, Marketer, Investor, GEEK!

00’s & 10’s: •  Investor: Founders Fund, Facebook fbFund, 500 Startups •  Companies: Mint.com, SlideShare, Twilio, WildFire, SendGrid •  Marketing: PayPal, Simply Hired, Mint.com, O’Reilly Media •  Speaker: Lean Startup, Web 2.0, Stanford/Facebook

80’s & 90’s: •  Entrepreneur: Founder/CEO Aslan Computing (acq’d) •  Developer: Windows / SQL DB consultant (Intel, MSFT) •  Engineer: Johns Hopkins‘88, BS Eng / Applied Math

Page 5: Startup Metrics for Pirates (Sept 2012)

500 Startups Seed Fund & Accelerator

(350+ companies, 20+ countries)

Page 6: Startup Metrics for Pirates (Sept 2012)

[ This Talk ]

Page 7: Startup Metrics for Pirates (Sept 2012)

Topics

•  Basic Concepts of “Startup Metrics 4 Pirates” •  3 Steps to AARRR: Product, Market, Revenue •  Constructing MVP: Just ONE Feature? •  Design (UX) & Distribution (MKTG) •  Winning: Market, Revenue, Profit?

Page 8: Startup Metrics for Pirates (Sept 2012)

Key Concepts

•  MVP = F(Customer, Problem, Time or $$$) •  PMF = F(Customer, Solution, Alternatives) •  AUX = F(Customer, Design/UX, Metrics) •  ACQ = F(Customer, Campaign, Vol, Cost, Conv) •  WIN! = F(Customer, Usage, Dist, Revenue)

Page 9: Startup Metrics for Pirates (Sept 2012)

Geek Renaissance

•  Tech Innovation •  Finance Innovation •  Design Innovation •  Social Innovation •  Global Innovation

Page 10: Startup Metrics for Pirates (Sept 2012)

Platforms 2.0 Search, Social, Mobile

Page 11: Startup Metrics for Pirates (Sept 2012)

What’s a Platform?

Users                                                .   .                                                            Money  

Features                

Growth   Profit  

Profitable  Growth  

Awesome  

Successful  Pla,orms    have  3  Things:  1)  Features  2)  Users  3)  Money  

Page 12: Startup Metrics for Pirates (Sept 2012)

Distribution Platforms Customer Reach: 100M+

•  Search: Google (SEO/SEM)

•  Social: Facebook, Twitter, Zynga, LinkedIn

•  Mobile: Apple (iPhone, iPad), Android

•  Media: YouTube (Video), Blogs, Photos

•  Comm: Email, Chat, SMS, Voice

Page 13: Startup Metrics for Pirates (Sept 2012)

DO Marketing! (It’s Not Evil)

•  Marketing is Both Qualitative + Quantitative •  Qualitative: Create Emotion, Drive Action •  Quantitative: Measure Results of Action •  Design (UX) & Distribution (MKTG) Matter •  Volume (#), Cost ($), Conversion (%)

Page 14: Startup Metrics for Pirates (Sept 2012)

[ Interesting Shit. ]

Page 15: Startup Metrics for Pirates (Sept 2012)

Read Geoffrey Miller Sex + Evolution + Consumer Mktg = Awesome Sauce

Page 16: Startup Metrics for Pirates (Sept 2012)

More Great Shit. Psychology + Comics

Page 17: Startup Metrics for Pirates (Sept 2012)

[The Lean Startup]

[Startup Metrics 4 Pirates]

Page 18: Startup Metrics for Pirates (Sept 2012)

Just Gimme the GOOD Metrics. Users, Pages, Clicks, Emails, $$$...?

Q: Which of these is best? How do you know? •  1,000,000 one-time, unregistered unique visitors •  500,000 visitors who view 2+ pages / stay 10+ sec •  200,000 visitors who clicked on a link or button •  20,000 registered users w/ email address •  2,000 passionate fans who refer 5+ users / mo. •  1,000 monthly subscribers @ $5/mo

the good stuff.

Page 19: Startup Metrics for Pirates (Sept 2012)

The Lean Startup

•  Talk to Customers; Discover Problems •  Progress ≠ Features (Less = More) •  Fast, Frequent Iteration (+ Feedback Loop) •  Measure Conversion; Compare 2+ Options •  Focus on Product/Market Fit (don’t “launch” b4) •  Keep it Simple & Actionable

Page 20: Startup Metrics for Pirates (Sept 2012)

Discover Customers (Steve Blank, SteveBlank.com)

Page 21: Startup Metrics for Pirates (Sept 2012)

LEARN BUILD

MEASURE

IDEAS

CODE DATA

Iterate, Dammit. (Eric Ries, StartupLessonsLearned.com)

Page 22: Startup Metrics for Pirates (Sept 2012)

Product/Market Fit b4 “Launch” (Sean Ellis, Startup-Marketing.com)

Startup-Marketing.com

Growth

Transition to Growth

Product/Market Fit

Page 23: Startup Metrics for Pirates (Sept 2012)

AARRR!: 5-Step Startup Metrics Model

Website.com

Biz Dev Ads,  Lead  Gen,  Subscriptions,  ECommerce  

Homepage / Landing Page

Product Features

ACQUISITION  

SEO SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Retention

Emails  &  Alerts  

System  Events  &  Time-­‐based  Features  

Blogs,  RSS,  News  Feeds  

Emails & widgets

Affiliates,  Contests  

Viral  Loops  

Page 24: Startup Metrics for Pirates (Sept 2012)

Startup Metrics for Pirates

•  Acquisition: users come to site from various channels •  Activation: users enjoy 1st visit: "happy” experience •  Retention: users come back, visit site multiple times •  Referral: users like product enough to refer others •  Revenue: users conduct some monetization behavior

AARRR!

(note: If you’re in a hurry, Google “Startup Metrics” & watch 5m video)

Page 25: Startup Metrics for Pirates (Sept 2012)

One Step at a Time.

1. Make a Good Product: Activation & Retention 2. Market the Product: Acquisition & Referral 3. Make Money: Revenue & Profitability

“You probably can’t save your Ass and your Face at the same time… so choose carefully.” – DMC

Page 26: Startup Metrics for Pirates (Sept 2012)

Startup Challenges

Startups have problems in 3 key areas:

•  Management: Set Priorities, Define Key Metrics

•  Product: Build “Right” Features. Measure, Iterate.

•  Marketing: Distribution, Distribution, Distribution. (Search, Social, Mobile)

Page 27: Startup Metrics for Pirates (Sept 2012)

Key Concepts

•  MVP = F(Customer, Problem, Time or $$$) •  PMF = F(Customer, Solution, Alternatives) •  AUX = F(Customer, Design/UX, Metrics) •  ACQ = F(Customer, Campaign, Vol, Cost, Conv) •  WIN! = F(Customer, Usage, Dist, Revenue)

Page 28: Startup Metrics for Pirates (Sept 2012)

[ Constructing MVP ]

Page 29: Startup Metrics for Pirates (Sept 2012)

Role: Founder / CEO

Q: Which Customers? Problems? Metrics? Why? A: Focus on Critical Few Actionable Metrics

(if you don’t use the metric to make a decision, it’s not actionable)

•  Hypothesize Customer Lifecycle •  Target ~3-5 Conversion Events (tip: Less = More)

•  Test, Measure, Iterate to Improve

Page 30: Startup Metrics for Pirates (Sept 2012)

Optimize 4 Happiness (both User + Business)

•  Define States of User + Business Value •  Prioritize (Estimate) Relative Value of Each State •  Move Users: Lower Value -> Higher Value •  Optimize for User Happiness + Business $$$ •  Achieve High Cust Value + Low ACQ$ @ Scale

$$$

Page 31: Startup Metrics for Pirates (Sept 2012)

What is Minimum Viable Product?

MVP = F(Customer, Problem, Time or $$$)

•  Focus on CUSTOMER –  Qualitative Discovery, Quantitative Validation

•  Get to know habits, problems, desires (FUN MATTERS) –  what causes pain? what causes pleasure?

•  Define 1-5 TESTABLE Conversion Metrics of Value –  Attention/Usage (session time, clicks) –  Customer Data (email, connect, profile) -  Revenue (direct or indirect) -  Retention (visits over time, cohort behavior) -  Referral (users evangelize to other users)

•  Note: Paid Solutions drive FOCUS (& pay rent)

Page 32: Startup Metrics for Pirates (Sept 2012)

Example Conversion Metrics (note: *not* actuals… your mileage may vary)

Stage Conversion Status Conv. %

Est. Value (*not* cost)

Acquisition Visitors -> Site/Widget/Landing Page (2+ pages, 10+ sec, 1+ clicks = don’t abandon)

60% $.05

Activation “Happy” 1st Visit; Usage/Signup (clicks/time/pages, email/profile reg, feature usage)

15% $.25

Retention Users Come Back; Multiple Visits (1-3x visits/mo; email/feed open rate / CTR)

5% $1

Referral Users Refer Others (cust sat >=8; viral K factor > 1; )

1% $5

Revenue Users Pay / Generate $$$ (first txn, break-even, target profitability)

2% $50

Page 33: Startup Metrics for Pirates (Sept 2012)

KILL A FEATURE. Something Sucks. Find It. KILL It.

• STOP ADDING FEATURES.

•  Find the ONE THING that users LOVE. •  How to figure out? TAKE. SHIT. AWAY. •  When they SCREAM, you’ve FOUND it. •  Then Bring it Back… Only Better.

•  Tip: KILL a Feature Every Week.

Page 34: Startup Metrics for Pirates (Sept 2012)

[ Getting 2 PMF ]

Page 35: Startup Metrics for Pirates (Sept 2012)

Role: Product / Eng / Design Q: What Features to Build? Why? When are you “Done”? A: Easy-to-Find, Fun/Useful, Unique Features that

Increase Conversion (stop iterating when increase decelerates) •  Wireframes = Conversion Steps •  Measure, A/B Test, Iterate FAST (daily/weekly) •  Optimize for Conversion Improvement

–  80% on existing feature optimization –  20% on new feature development

Page 36: Startup Metrics for Pirates (Sept 2012)

What is Product/Market Fit? PMF = F(Customer, Solution, Alternatives*)

•  Product / Market Fit occurs when: –  Customers like your stuff better than other options –  Not static, Not optimal – just Local Max 4 F(customers, solution, time) –  make sure you’re moving in optimal direction 2 local max

•  Q: what competitive solutions are available? –  … that your customers know about? –  how are you diff/same? –  in ways that people care about? (will pay for)

•  KILL a FEATURE regularly (or rotate 1% tests) –  Q: what is MOST $ cust pay 4 LEAST func MVP relative 2 BEST alt?

•  NICHE 2 WIN: RE-define cust + DIFFerentiated features

Page 37: Startup Metrics for Pirates (Sept 2012)

Better or Different.

Funny!

Shocking !!! Accepted

Not Funny.

Page 38: Startup Metrics for Pirates (Sept 2012)

[ Testing 4 AUX ]

Page 39: Startup Metrics for Pirates (Sept 2012)

Discover Meaning Why Should Users CARE About Your Product?

Kathy Sierra: “Creating Passionate Users”

Page 40: Startup Metrics for Pirates (Sept 2012)

Discover Meaning Keywords, Images, Call-to-Action

Top 10 - 100 words •  Your Brand / Products •  Customer Needs / Benefits •  Competitor’s Brand / Products •  Semantic Equivalents •  Misspellings

Relevant images •  People •  Products •  Problems •  Solutions

Call-to-Action •  Words •  Images •  Context •  Button/Link •  Emotion

Result •  Positive? •  Negative? •  Neutral (= Death) •  A/B test & Iterate

Page 41: Startup Metrics for Pirates (Sept 2012)

How 2 Tell if Design/UX is Good?

AUX = F(Customer, Design/UX, Metrics)

•  Don’t "LAUNCH" Until Your Product Doesn't Suck. –  In fact, Stop Thinking about it as a Launch – it’s Continuous –  Define Metrics, Measurability for Design / UX –  Focus on Psychology of User –  Relative to Competitive Alternatives (that your customers know about) –  Keep Testing 4 Awesomeness! (Q: does it Rock Yet? )

•  RAMP Mktg & $$$ AFTER it’s clear your MVP is: –  Functional = useful for >1 customers –  Differentiated = better than other stuff availabile –  Awesome (see above)

•  Minimum Viable Design = Minimum Viable Awesomeness –  what's the crappiest thing u can release & still be awesome?

Page 42: Startup Metrics for Pirates (Sept 2012)

[ Metrics 4 ACQ ]

Page 43: Startup Metrics for Pirates (Sept 2012)

Role: Marketing / Sales

Q: What channels? Which users? Why? A: High Volume (#), Low Cost ($), High Conv (%)

•  Design & Test Multiple Marketing Channels + Campaigns •  Select & Focus on Best-Performing Channels & Themes •  Optimize for conversion to target CTAs, not just site/landing page •  Match/Drive channel cost to/below revenue potential

•  Low-Hanging Fruit: –  Blogs –  SEO/SEM –  Landing Pages –  Automated Emails

Page 44: Startup Metrics for Pirates (Sept 2012)

Example Marketing Channels

•  PR •  Contest •  Biz Dev •  Direct Marketing •  Radio / TV / Print •  Dedicated Sales •  Telemarketing

•  Email •  SEO / SEM •  Blogs / Bloggers •  Viral / Referral •  Affiliate / CPA •  Widgets / Apps •  LOLCats ;)

Page 45: Startup Metrics for Pirates (Sept 2012)

MAARRRketing Plan

Marketing Plan = Target Customer Acquisition Channels •  3 Important Factors = Volume (#), Cost ($), Conversion (%) •  Measure conversion to target customer actions •  Test audience segments, campaign themes, Call-To-Action (CTAs)

[Gradually] Match Channel Costs => Revenue Potential •  Increase Vol. & Conversion, Decrease Cost, Optimize for Revenue Potential •  Avg Txn Value (ATV), Ann Rev Per User (ARPU), Cust Lifetime Value (CLV) •  Design channels that (eventually) cost <20-50% of target ATV, ARPU, CLV

Consider Costs, Scarce Resource Tradeoffs •  Actual $ expenses •  Marketing time & resources •  Product/Engineering time & resources •  Cashflow timing of expense vs. revenue, profit

ACQ = F(Customer, Campaign, Vol, Cost, Conv)

Page 46: Startup Metrics for Pirates (Sept 2012)

[ What is WINNING? ]

Page 47: Startup Metrics for Pirates (Sept 2012)

Choose #WINNING Metrics

WIN = F(Customer, Usage, Dist, Revenue) •  after MVP functional use, several options:

–  better Usage – Activation & Retention (AUX) –  more Users -- Distribution / Acquisition –  mo' Money --- U Wants 2 Get Paid, Yo.

•  understand ACQ$ vs REV$, optimize 4 short-term –  High(er) volume usually a priority –  costs may change as vol increases

Page 48: Startup Metrics for Pirates (Sept 2012)

[ The Lean Investor ]

Page 49: Startup Metrics for Pirates (Sept 2012)

Startup 2.0: “Lean Investor” Model

Method: Invest in startups using incremental investment, iterative development. Start with lots of small experiments, filter out failure, and expand investment upon success.

•  Incubator: $0-250K (“Product Viability”) •  Seed: $100K-$2M (“Expand Distribution”) •  Venture: $1M-$5M (“Maximize Revenue”)

Page 50: Startup Metrics for Pirates (Sept 2012)

Investment #1: Incubate (“Product”)

•  Structure –  1-3 founders –  $25K-$250K investment –  Incubator environment: multiple peers, mentors/advisors

•  Build Functional Prototype / “Minimum Viable Product” (MVP): –  Concept->Alpha, ~3-6 months –  Develop Minimal Critical Feature Set => Get to “It Works” –  Instrument Basic Dashboard, Conversion Metrics –  Test Cust. Adoption (10-1000 users) / Cust. Satisfaction (Scale: 1-10)

•  Demonstrate Concept, Reduce Product Risk, Test Functional Use •  Develop Metrics & Filter for Follow-on Investment

Page 51: Startup Metrics for Pirates (Sept 2012)

Investment #2: Seed (“Market”) •  Structure

–  2-5 person team –  $100K-$2M investment –  Syndicate of Angel Investors / Small VC Funds

•  Improve Product, Expand Market, Test Revenue: –  Alpha->Beta, ~6-12 months –  Customer Sat ≥ 6 => Get to “Doesn’t Suck” –  Setup A/B Testing Framework, Optimize Conversion –  Test Marketing Campaigns, Cust Acqstn Channels

•  Prove Solution/Benefit, Assess Market Size •  Test Channel Cost, Revenue Opportunity •  Determine Org Structure, Key Hires

Page 52: Startup Metrics for Pirates (Sept 2012)

Investment #3: Venture (“Revenue”)

•  Structure –  5-10 person team –  $1M-$5M investment –  VC Investors

•  Make Money, Get to Sustainability: –  Beta->Production, 12-18 months –  Customer Sat ≥ 8 => “It Rocks, I’ll Tell My Friends” –  MktgPlan => Predictable Channels / Campaigns + Budget –  Scalability & Infrastructure, Customer Service & Operations –  Connect with Distribution Partners

•  Prove/Expand Market, Operationalize Business •  Future Milestones: Profitable/Sustainable, Exit Options

Page 53: Startup Metrics for Pirates (Sept 2012)

NOTE: Don’t Pitch Me, Bro.

Seriously: Don’t. Fucking. Pitch Me. (and don’t email me either, cuz i won’t read it)

Page 54: Startup Metrics for Pirates (Sept 2012)

Links & Resources Additional References:

•  Influence: The Psychology of Persuasion Robert Cialdini (book)

•  The Mating Mind Geoffrey Miller (book)

•  Putting the Fun in Functional Amy Jo Kim (etech 2006 preso)

•  Futuristic Play Andrew Chen (blog)

•  Don’t Make Me Think Steve Krug (book)

•  Designing for the Social Web Joshua Porter (book, website)

•  Startup Lessons Learned Eric Ries (blog)

•  Customer Development Methodology Steve Blank (presentation, blog)

•  Startup-Marketing.com Sean Ellis (blog)

•  KISSmetrics.com Hiten Shah / Neil Patel (website)

•  How To Pitch a VC Dave McClure (slides, NSFW)

•  Understanding Comics Scott McCloud (book)

Page 55: Startup Metrics for Pirates (Sept 2012)

Appendix

Page 56: Startup Metrics for Pirates (Sept 2012)

Startup Metrics

Activation

Page 57: Startup Metrics for Pirates (Sept 2012)

Website.com

Activation Criteria:

•  10-30+ seconds

•  2-3+ page views

•  3-5+ clicks

•  1 key feature usage

do LOTS of landing page & A/B tests –

make lots of dumb guesses & iterate FAST

Homepage / Landing Page

Product Features

SEO SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Activation

Page 58: Startup Metrics for Pirates (Sept 2012)

Activation What do users do on their first visit?

Example Activation Goals •  Click on something! •  Account sign up / Emails •  Referrals / Tell a friend •  Widgets / Embeds •  Low Bounce Rate

Activation Tips •  Less is more •  Focus on user experience / usability •  Provide incentives & call to actions •  Test and iterate continuously

Page 59: Startup Metrics for Pirates (Sept 2012)

Activation What do users do on their first visit?

Key Metrics to Track ü Pages per visit ü Time on site ü Conversions

Page 60: Startup Metrics for Pirates (Sept 2012)

Activation Tools

Crazy Egg (Visual Click Mapping) http://crazyegg.com

Google Website Optimizer (A/B & Multivariate Testing) http://google.com/websiteoptimizer

Marketo.com (B2B Lead Generation Management) http://marketo.com

Resources Experimentation and Testing: A Primer

kaushik.net/avinash/2006/05/experimentation-and-testing-a-primer.html Landing Page Design Toolbox: 100 Tips & Tools

http://tinyurl.com/326co6 Landing Page Tutorials & Case Studies

http://www.copyblogger.com/landing-pages/ 101 Easy Easy to use Google Website Optimizer

http://conversion-rate-experts.com/articles/101-google-website-optimizer-tips/

Page 61: Startup Metrics for Pirates (Sept 2012)

Startup Metrics

Retention

Page 62: Startup Metrics for Pirates (Sept 2012)

Website.com

Homepage / Landing Page

Product Features

SEO SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Emails  &  Alerts  

System  Events  &  Time-­‐based  Features  

Blogs,  RSS,  News  Feeds  

Automated emails:

•  lifecycle emails @ +3, +7, +30d

•  status / “best of” weekly/monthly

•  “something happened” emails

BUT:

•  make it easy to unsubscribe

Tip on emails:

•  > 80% or more on SUBJECT LINE

•  < 20% or less on BODY TEXT

Retention

Page 63: Startup Metrics for Pirates (Sept 2012)

Cohort Analysis: •  Distrib of Visits over Time •  Rate of Decay •  Effective Customer Lifecycle Retention Methods ü  Automated Emails

* Track open rate / CTR / Quantity

ü  RSS / News Feeds * Track % viewed / CTR / Quantity

ü  Widgets / Embeds * Track impressions / CTR / Quantity

Retention How do users come back? How often?

Page 64: Startup Metrics for Pirates (Sept 2012)

Example Retention Goals •  1 - 3+ visits per month •  20% open rate / 2% CTR •  High deliverability / Low spam rating •  Long customer life cycle / Low decay •  Identify fanatics and cheerleaders

Retention Tips •  Email is simple and it works •  BUT make unsubscribe easy •  80% subject line / 20% body text •  ACTUALLY 99% subject line / 1% body text •  Fanatics = virality + affiliate channel (bloggers?)

Retention How do users come back? How often?

Page 65: Startup Metrics for Pirates (Sept 2012)

Retention How do users come back? How often?

Key Metrics to Track ü  Source ü Quantity ü Conversions ü  Visitor Loyalty ü  Session Length

Page 66: Startup Metrics for Pirates (Sept 2012)

Retention Tools

Campaign Monitor / MailChimp (email newsletter software) campaignmonitor.com / mailchimp.com

TriggerMail (site-centric email management) triggermail.net

Litmus (email and website design testing - clients / browsers) litmusapp.com

Resources 30 free HTML email templates

campaignmonitor.com/resources/templates.aspx Best Practices in Writing Email Subject Lines

mailchimp.com/resources/best-practices-in-writing-email-subject-lines.phtml Learning Viral: Viral Emails of Tagged.com

okdork.com/2008/04/10/learning-viral-studying-taggedcom/

Page 67: Startup Metrics for Pirates (Sept 2012)

Startup Metrics

Acquisition

Page 68: Startup Metrics for Pirates (Sept 2012)

Website.com

Marketing Channels: •  largest-volume (#) •  lowest-cost ($) •  best-performing (%)

Acquisition SEO

SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Page 69: Startup Metrics for Pirates (Sept 2012)

Acquisition Where are users coming from?

Acquisition Methods ü SEO / SEM ü Blogs ü Email ü Social Media &

Social Networks ü Domains

Page 70: Startup Metrics for Pirates (Sept 2012)

Acquisition Keyword Vocabulary

Top 10 - 100 words •  Your Brand / Products •  Customer Needs / Benefits •  Competitor’s Brand / Products •  Semantic Equivalents •  Misspellings

Things to analyze •  Sources •  Volume •  Cost •  Conversion

Page 71: Startup Metrics for Pirates (Sept 2012)

Acquisition Where are users coming from?

Key Metrics to Track ü Quantity (#) ü Cost ($) ü Conversions (%)

Example

Page 72: Startup Metrics for Pirates (Sept 2012)

Acquisition Tools

Google Analytics (web analytics) google.com/analytics

Google Keyword Tool (keyword research tool) adwords.google.com/select/KeywordToolExternal

SEO Book Tools (SEO related tools) tools.seobook.com

Resources SEO Book Blog

seobook.com/blog The Social Media Manual: Read Before You Play

searchengineland.com/071120-144401.php Strategies to ruthlessly acquire users

andrewchen.typepad.com/andrew_chens_blog/2007/04/10_obvious_stra.html

Page 73: Startup Metrics for Pirates (Sept 2012)

Startup Metrics

Referral

Page 74: Startup Metrics for Pirates (Sept 2012)

Website.com

Homepage / Landing Page

Product Features

Acquisition  

SEO SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Retention

Emails  &  Alerts  

System  Events  &  Time-­‐based  Features  

Blogs,  RSS,  News  Feeds  

Emails & widgets

Affiliates,  Contests  

Viral  Loops  

Focus on driving referrals *after* users have a “happy” experience; avg score >= 8 out of 10

Referral

Page 75: Startup Metrics for Pirates (Sept 2012)

Referral How do users refer others?

Referral Methods ü Send to Friend:

Email / IM ü Social Media ü Widgets / Embeds ü Affiliates

Page 76: Startup Metrics for Pirates (Sept 2012)

Referral Viral Growth Factor

Viral Growth Factor = X * Y * Z X = % of users who invite other people Y = average # of people that they invited Z = % of users who accepted an invitation

A viral growth factor > 1 means an exponential organic user acquisition.

Page 77: Startup Metrics for Pirates (Sept 2012)

Referral Tools

Gigya (social media distribution & tracking tool) gigya.com

ShareThis / AddThis (sharing buttons) sharethis.com / addthis.com

GetMyContacts (PHP contacts importing & invitation software) getmycontacts.com

Resources Seven Ways to GO VIRAL

lsvp.wordpress.com/2007/03/02/seven-ways-to-go-viral/ What’s your viral loop? Understanding the engine of adoption

andrewchen.typepad.com/andrew_chens_blog/2007/07/whats-your-vira.html Metrics: Where Users Come From

slideshare.net/guest2968b8/rockyou-snap-summit-32508

Page 78: Startup Metrics for Pirates (Sept 2012)

Startup Metrics

Revenue

Page 79: Startup Metrics for Pirates (Sept 2012)

Website.com

Biz Dev Ads,  Lead  Gen,  Subscriptions,  ECommerce  

Homepage / Landing Page

Product Features

Acquisition  

SEO SEM

Apps & Widgets

Affiliates

Email

PR Biz Dev

Campaigns, Contests

Direct, Tel, TV

Social Networks

Blogs

Domains

Retention

Emails  &  Alerts  

System  Events  &  Time-­‐based  Features  

Blogs,  RSS,  News  Feeds  

Emails & widgets

Affiliates,  Contests  

Viral  Loops  

Revenue

This is the part *you* still have to figure out… (we don’t know jack about your business)

Page 80: Startup Metrics for Pirates (Sept 2012)

Revenue How do you make money?

Revenue Tips

•  Don’t Rely on AdSense (only) •  Start Free => 2% “Freemium” •  Subscription / Recurring transactions •  Qualify your customers -> Lead generation (arbitrage) •  Sell something! (physical or virtual)

Page 81: Startup Metrics for Pirates (Sept 2012)

Revenue Resources & Tools

Revenue Metrics (Andrew Chen) http://tinyurl.com/47r63a

How to Create a Profitable “Freemium” Startup (Andrew Chen) http://tinyurl.com/8z9ygk

2008 Affiliate Marketing Review (Scott Jangro) http://tinyurl.com/86wak4